Argentina reaches out to investors
February 13, 2014
Argentina says it wants to sign a truce with creditors and Spain’s Repsol
Despite a devaluation in January that rocked Latin American financial markets, the governor of the Argentine province of Buenos Aires on Wednesday said the troubled country wants to solve problems with holdout creditors and Spain’s Repsol so that it can tap capital markets again.
Daniel Scioli, a highly influential political figure in Argentina, said that ongoing negotiations with creditors would produce agreements and make the country an attractive destination for foreign investment.
“All the negotiations that we are moving forward with — the issue with Repsol, the [World Bank arbitration body] ICSID, holdouts, the Paris Club — are going to encourage and facilitate a strong flow of investments and I invite the business world to look at this as an opportunity,” Scioli told reporters in New York.
The government of Cristina Fernández nationalized Argentina’s flagship oil company YPF in 2012 when it seized control of Spain’s Repsol majority stake in the firm. Repsol is demanding compensation for its shares, which it values at $10.5bn.
“We want to normalize this situation [so that] Argentina can rejoin the global economy in full, what is known as the capital markets, but we don’t want more debt to pay our debt, we want investments for strategic needs,” Scioli said.
Scioli, who is very close to President Fernández and a leading member of the ruling coalition, said Argentina would require investments worth $200bn in the next 10 years and foreign investors were invited to chip in.
“We’ve lowered the debt, we have increased exports, we’ve doubled economic growth, now is the time to give sustainability to this growth, to this recovery, to this new stage of development and without a doubt credit will be very important for the private sector and for public investments as well,” he said.
Regarding fears that the country may be depleting its foreign reserves since the peso fell in late January, he said that Argentina was on track for record crop harvests this year, which would allow the country to replenish its foreign currency reserves. LF